OSC – On the LineOSC – On the Line

Production DelinquenciesProduction Delinquencies

Scott Welker

AMSOS-PR

(309) 782-7097

welkerd@osc.army.mil

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AMMUNITION KEY METRICS and OBJECTIVESAMMUNITION KEY METRICS and OBJECTIVES

Safety Is Foremost ConsiderationMust Provide Safe Ammunition to

Troops Quality>>Schedule>Cost

Quality, On-time Product Can Keep Us Training, Fighting, and Winning the War

Cost Remains a Constraint

OUTLOADING CAPABILITY

AMMO FOR THE WARFIGHT

AMMO FOR TRAINING

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AMMO READINESS(WARFIGHT/TRAINING

S-RATING R-RATING

Quantity On-Hand Quantity Serviceable

Total Requirement Quantity On-hand

CompareTo

C-RATING

A M M O O V E R A L L

H E B P

H E R A IC M

1 0 5 1 5 5 .... . . . . . . . .

F am ily (i.e . A rt ille ry)What is the weightingAmong these (at eachlevel) For importance?

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Am m o Readiness S-Rating(W arfight/Training)

O p era tion sB u d g etin g

M aintenanceBudgeting

P rod u c tionB u d g etin g

A c tu a lO n -H an d

D M W R /L O IU p d ate /A p p rova l

C om p on en tM ovem en t

A P E M ovem en t

M aintenanceProgram Planning

M ain ten an ceP erfo rm an ce

R ejec ts

F irs t A rtic leTes tin g

B a llis t ic &A ccep tan ce

Quality ofM aintenance

M aintenanceExecution

M aintenanceor Renovation

C ap ab ility

C ap ac ity

H ea lth

L IF

M IIF

Supplier/IndustrialBase Assessm ent

A cq u is it ionP lan s /8 0 6

J& A

R isk A ssessm en tfo r Tech Issu es

TD PC ertifica tion

G F M /G F E

E S IP

C rit ica l D efec tC lau ses

R ep ortin gR eq u irem en ts

M ake or B u y

A rsen a l A c t

AcquisitionStrategy

R ece ivin gF u n d in g

O n -Tim e D e live ry(S ch ed u le )

W ith in C os t

ProductionPerform ance

R ejec ts

F irs t A rtic leTes tin g

B a llis t ic &A ccep tan ce

Quality ofProduction

ProductionExecution

Production

NewDeliveries

Available Funding

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Am m o Readiness R-Rating(W arfight/Training)

Q u ality o f D es ig n(S h e lf/S ervice L ife )

L arg e C a lib e r/S m a ll C a lib e r A S R P

C en tra lized C on tro l F u n c tionTes t P rog ram (C C TF P )

P rop e llan t S tab ility &C om p on en t D e te rio ra tin g

Tes tin g

ASRP Testing

P eriod ic In sp ec tion

R ece ip t/Is su e

S afe ty in S to rag e

Inspection

M alfu n c tionIn ves tig a tion (M IF )

D efic ien cyIn ves tig a tion (D IF )

A m m u n it ionIn c id en t (A IF )

L o t C on tro lN u m b er (L C N )

M alfunction/IncidentInvestigation

A rea O p era tion s(M a in ten an ce , D em ilita riza tion

R ew areh ou s in g )

Am m o Surveillance

Available Funding(For Quality Surveillance

or T esting)

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Start FY 01 and FY 02 ExecutionStart FY 01 and FY 02 Execution

FY 02 in millions(Oct 01 - FY 01 & Prior undelivered)

$743

$349$467

FY 01 in millions(Oct 00 - FY 00 & Prior undelivered)

$699

$428$389

Total: $151626% Green46% Amber28% Red

Total: $155930% Green48% Amber22% Red

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194 Programs1320 Orders

Orders Dollars (M) Orders Dollars (M) Orders Dollars (M) Orders Dollars (M)0Q02 Projected 243 349 217 743 860 467 1320 15591Q02 Planned 216 357 171 673 767 438 1154 1468

Actual 240 296 203 738 722 348 1165 13822Q02 Planned 188 320 130 598 680 372 998 1290

Actual 0 03Q02 Planned 165 213 114 544 527 301 806 1058

Actual 0 04Q02 Planned 152 411 78 295 328 156 558 862

4Q02Current Proj 0 0

OutYears Planned 152 411 78 295 328 156 558 862

Red Amber Green Total

372 301 156

598544

295

320

213

411

438467 348

673 738743

357296

349

Start FY02

1st QtrPlan

1st QtrActuals

2d QtrPlan

2d QtrActuals

3d QtrPlan

3d QtrActuals

4th QtrPlan

4th QtrActuals

Do

llars

in M

illio

ns

FY 02 Execution PlanFY 02 Execution PlanProjectionsProjections

Forecast delivery of $697M in FY02

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Delinquencies by Customer ($M)Delinquencies by Customer ($M) FY01 & Earlier Orders FY01 & Earlier Orders

1 October 2001 $176.6M Total Delivered

including 31 Dec 2001

$1558.7M WIP; 22.4% Delinquent $52M in Delinquent Delivered $1382.1M WIP; 21.4% Delinquent

Arm

y

Air

Fo

rce

Ma

rin

es

Na

vy

Typ

e T

ota

l

Typ

e-P

erc

ent

o

f To

tal Commodity

Arm

y

Air

Fo

rce

Ma

rin

es

Na

vy

Typ

e T

ota

l

Typ

e-P

erc

ent

o

f To

tal

0 0 26 0 27 8% Mortars 0 0 13 0 13 5%0 1 0 10 11 3% Fuzes 0 0 0 10 10 3%

26 1 10 0 37 11% Artillery 48 1 10 0 59 20%0 9 0 22 31 9% Bombs 0 16 0 27 43 14%

39 10 7 1 57 16% Med Cal 34 10 10 0 54 18%65 0 2 0 66 19% Tank 11 0 0 0 12 4%3 0 2 1 6 2% Demo Mat 2 0 19 3 25 8%3 18 2 10 33 9% Pyrotechnics 2 14 2 9 27 9%

26 0 13 2 42 12% Small Arms 21 0 9 1 31 11%2 0 22 14 38 11% All Others 5 0 4 14 23 8%

164 40 84 60 348 Customer Total 123 42 67 64 296

47% 11% 24% 17% 100% Customer Percent of Total 42% 14% 22% 22% 100%

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COCO34%

GOGO31%

GOCO35%

COCO

GOGO

GOCO

Distribution of Delinquent (Red) Distribution of Delinquent (Red) Programs Programs ($296M)($296M)

A/O 31 DecOnly $43m Delinquent to Kschedule

A/O 31 Dec approx $205mDelinquent to CRDD/FDP on contracts

COCO 34% $101,731,654GOGO 31% $90,799,413GOCO 35% $103,451,752

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Root Causes IdentifiedRoot Causes Identified

Percent of All

Production Phase Root Causes

Quality Production Practices 12%

First Time Production 7%

Manufacturing Base Turnover 5%

Inadequate Facilities 5%

Sub-Total: 29%

Acquisition Phase

Data Management 11%

Economic Ordering 8%

Terminations & Defaults 6%

Business Decisions 5%

Customer Changes 4%

Sub-Total: 34%

Engineering Phase

Technical Data & Design 13%

Total: 76%

Root Cause Facts:• 80 Ammunition DODICS Studied

• 140 Separate Root Causes Identified

• 28% of DODICS single cause identified

• 72% of DODICS multiple causes identified

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RISKRISK

Risk MitigationRisk Mitigation

Program Risk Program Risk AssessmentAssessment

•Identify Risk areas early to Identify Risk areas early to influence budget & acq influence budget & acq strategiesstrategies•Inform customers of risk Inform customers of risk before accepting fundsbefore accepting funds•Implement problem Implement problem prevention/risk mitigation plansprevention/risk mitigation plans

Critical DefectsCritical Defects•Correctly Classify CriticalsCorrectly Classify Criticals•Prevent Criticals MfgPrevent Criticals Mfg•Use Automated InspUse Automated Insp

Automated Automated Systems Systems

InitiativesInitiatives•CTC; WLMP; othersCTC; WLMP; others•Analysis to replace number Analysis to replace number crunchingcrunching•Key metricsKey metricsProgram Program

ReviewsReviews•Internal/SupplierInternal/Supplier•Focus on problem Focus on problem programsprograms•Share lessons learnedShare lessons learned•Track progress on Track progress on problem prevention problem prevention actionsactions

QA FoundationQA Foundation•Common Common policies/procedurespolicies/procedures•Trained HQ and Plant StaffTrained HQ and Plant Staff•Communicate expectations Communicate expectations to contractors, DCMA, to contractors, DCMA, ARDEC, installations.ARDEC, installations.•Audit capability - Audit capability - prevention oriented.prevention oriented.•Grow “Next Generation” Grow “Next Generation” QA SpecialistsQA SpecialistsRISKRISKRISKRISKRISKRISKRISKRISKRISKRISKRISKRISKRISKRISK

Journey to ExcellenceJourney to Excellence

Safe, Quality Safe, Quality Ammo Delivered Ammo Delivered

On-TimeOn-Time

•Key CharacteristicsKey Characteristics•Variation ReductionVariation Reduction - Lot-to-Lot- Lot-to-Lot - Item-to-Item- Item-to-Item

•Establish disciplined Establish disciplined process for decisions, process for decisions, problem solving, and problem solving, and lessons learnedlessons learned

Process Process ManagementManagement•Document processes for Document processes for workforce educationworkforce education•Provide customer focusProvide customer focus•Improve our businessImprove our business•Define roles/responsibilities Define roles/responsibilities •Identify metricsIdentify metrics

Long-Term ContractsLong-Term Contracts•Incentivize quality, delivery, &Incentivize quality, delivery, &investment at competitive priceinvestment at competitive price

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FY 02 Funds for Procurement FY 02 Funds for Procurement of Ammunition by Service - $2,528,508of Ammunition by Service - $2,528,508

DMA Portion by Service – Approximately $851DMA Portion by Service – Approximately $851(in Millions)(in Millions)

FY 02 Total Procurement Appropriation by Service

$148,070

$866,644$1,200,465

$313,329

Army Navy Marine Corps Air Force

SOURCE: FY02 Defense Appropriations Conference Report 107-350

Includes for ArmyDemil $73.3mPdn Base Spt - $83.4mARMS - $14.7m

DMA Portion by Service

$80

$247$428

$97

Army

Navy

USMC

Air Force

Addt’l $100.9M in Other Customer & FMS cases were acptd in FY01

OSC Contract Center supted PM Rockets (HYDRA) $181M in FY01

SOURCE:Execution Price List, 16 Nov 01

29% of total Air Force

29% of total Air Force

36% of total Army

36% of total Army

54% of total

USMC

31% of total Navy

Principal Delinquent DODICsAs Of 31 Dec 2001

List represents 73% Undelivered Red Dollars

MIPR Undel Number Comp SMCADODIC Customer Nomen Value-$M Value-$M Orders Date TeamA064 A,M,N CTG 5.56MM 4 BALL 25 7.8 4 200205 Sm ArmsA075 A,M CTG 5.56MM BLANK 10.6 6.5 5 200208 Sm ArmsA940 A,M CTG 25MM M910 46 11.1 3 200206 MedClA941 AF CTG 25MM HEI PGU-38 10.4 10.3 2 200201 Tank/MedClB129 FMS CTG 30MM M789 8 7.5 3 200203 Tank/MedClB542 M,,A,FMS, CTG 40MM HEDP M430A1 26.5 15.7 5 200205 40mm C062 N,NFMS CTG 76MM MK201 14.2 14.2 5 200304 BombsC784 A,M CTG TANK 120MM M831 98.2 5.7 3 200202 TankC785 A CTG TANK 120MM M865 205.9 5.8 2 200204 TankC871 A,M,FMS CTG MORTAR 81MM 13.3 13.3 6 200201 MortarsD505 FMS PROJ 155MM M485 12.2 12.2 1 200206 ArtyD544 A PROJ ARTY 155MM M107 64.6 30.6 3 200202 ArtyD550 M PROJ ARTY 155MM 10 10 1 200206 ArtyE756 AF BOMB GP 2K LB BDU/56 6.9 6.9 1 200208 BombsEB04 N BOMB GP 2K LB BLU-117 5.5 5.5 1 200210 BombsF017 N BOMB PRAC BDU-45/B 7.1 7.1 1 200201 BombsF261 AFFMS BOMB GP MK84 5.3 5.3 1 200205 BombsF279 N,NFMS BOMB GP MK84-7 9 9 2 200209 BombsF770 N FUZE PROX FMU-140B 130.8 8.5 2 200301 BombsL463 AF,AFFMS FLARE ACFT IR CNTRMS 7.3 5.7 2 200207 BombsM757 M CHG ASSY DEMO M183 19.3 16.4 1 200206 Demo

TOTALS 736.1 215.1 54

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Principal Amber DODICsAs of 31 Dec 2001

List Represents 82% of Undelivered Amber Dollars

MIPR Undel Number Latest SMCADODIC Customer Nomen Value - $M Value - $M Orders Comp Dt Team

A064 A,M,N CTG 5.56MM BALL M855 28.8 28.8 6 200211 Sm Cal

A075 A,M CTG 5.5.6MM BLANK 8.1 8.1 12 200303 Sm Cal

A557 A,AF,N CTG CAL .50 4 BALL/1 TRACER 9.8 9.8 5 200211 Sm Cal

A576 M CTG CAL .50 LINKED 4 API 8.3 8.3 1 200211 Sm Cal

AA24 AF CTG 20MM PGU 27 A/B 13.7 13.7 1 200303 Sm Cal

AA33 A CTG 5.56MM M855 BALL 12.4 9.8 1 200210 Sm Cal

AA45 A CTG 5.56MM BALL M855 GREEN 19.2 19.2 1 200305 Sm Cal

AA48 A CTG 5.56MM GREEN CLIP 15.0 15.0 1 200210 Sm Cal

B116 AF CTG 30MM LINKED TP PGU-15/B 48.4 48.4 2 200306 Med Cal

B584 A,N CTG 40MM TP M918 74.8 60.1 3 200308 Med Cal

C449 A CTG ARTY 105MM ILLUM M314 7.7 7.7 1 200301 Arty

C785 A,M,FMS CTG TANK 120MM TPCSDS-T 108.6 94.3 3 200211 TankD544 A,FMS PROJ ARTY 155MM HEM107 78.2 78.2 2 200307 Arty E511 N BOMB GP 1000 LB INERT MK83 18.9 18.9 1 200405 Bomb/PyroE756 AF BOMB GP BDU-56/B 16 16 2 200412 Bomb/Pyro

EB04 N BOMB GP 2000LB MK84 32.1 32.1 2 200310 Bomb/PyroF013 AF BOMB PRAC BDU-50A/B 37.7 37.7 2 200304 Bomb/PyroF017 N BOMB PRAC 500 LB BDU-45/B 20.4 20.4 2 200312 Bomb/PyroF142 N BOMB GP BLU-109 A/B 19.2 19.2 2 200312 Bomb/PyroF275 AF,AFMS BOMB GP 2K LB TRITONAL 7.9 7.9 4 200402 Bomb/PyroL463 AF,AFMS FLARE ACFT IR COUNTER 14.4 14.4 6 200308 Bomb/PyroM913 M CHG DEMO LINEAR M58 SERIES 26.1 26.1 2 200309 DemoML25 M CHG DEMO FLEX LINEAR HE C4 8.3 8.3 1 200309 Demo

TOTALS 634.0 602.4 63.0

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